Episode Details

NIO Inc (NIO) Q2 2026 — NIO closed the reaction session at $4.06, -4.0% - the lowest close in twelve months, on 81m shares. It is 49.4% below its $7.89 high of 2 October 2025. NIO delivered 24,193 more vehicles in the June quarter than in the March quarter - a 29.0% jump, and 49.4% more than a year ago. Those extra cars brought RMB1,047m of incremental gross profit and cost RMB1,086m of incremental operating expense, so the operating loss WIDENED, from RMB309m to RMB347m. SG&A per vehicle fell just 1.9% on 29.0% more volume. And the volume is now gone: 35,934 cars in July, 35,836 in August, and a Q3 guide of 108,000-111,000 that is only +0.3% to +3.1% sequential. THE CALL: SELL (3/5, MODERATE) — base-case value ~$2.44 vs ~$4.06 today. KEY METRICS: - PERIOD: the THREE MONTHS ended 30 June 2026. NIO is a foreign private issuer: it files a 6-K, reports in RMB and translates at one rate, RMB6.7851 to US$1.00 (30 June H.10 noon buying rate). One ADS = ONE ordinary share - DELIVERIES 107,658 (+29.0% QoQ, +49.4% YoY) - but July 35,934 and August 35,836 against a Q2 monthly average of 35,886. Still 13.7% under the Q4 2025 peak of 124,807 - THE INCREMENTAL BRIDGE: +RMB1,047m gross profit vs +RMB1,086m opex = a RMB38m gap, exactly the widening in the operating loss. Incremental gross margin 15.9% vs 18.4% blended - REVENUE $4,736m (+69.1% YoY) - GROSS MARGIN 18.4%, up 840bp in a year - VEHICLE MARGIN 18.5% - OPERATING LOSS $51m - NET LOSS $78m - GAAP EPS -$0.04 vs a -$0.07 estimate - EARNINGS QUALITY: the RMB24.8m 'adjusted net profit attributable' is a RMB722m loss plus RMB554m stock comp plus RMB192m of accretion on redeemable NCI. Strip that last add-back and it is a RMB168m LOSS - BALANCE SHEET: RMB56.7bn ($8,352m) of cash - but trade and notes payable are $8,900m, MORE than the whole cash pile, and 209 days of cost of sales. NIO equity is 2.97% of assets. No cash flow statement in this release - GUIDANCE Q3 2026: 108,000-111,000 vehicles (+0.3% to +3.1% sequential) and RMB33,285m-RMB34,051m revenue. The company frames it as +53% to +56% YoY - VALUATION: EV $7.89bn = 0.42x annualised sales. 2028 scenarios $1.15 / $2.43 / $4.72 weighted to $2.44. The price implies a 5.15% operating margin vs the 0.64% just posted - WALL STREET: not one house has published since this print. Newest target 22 May 2026 (102 days before). Bernstein $6.00, CMB Int'l $7.00, BofA $6.80, HSBC $6.80; average $6.65. We are at $2.44 What to watch: Two consecutive months above 38,000 deliveries, or a quarter where SG&A per vehicle falls faster than volume rises. Against that: September deliveries below 36,230 would miss the guide outright. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.